Why do so many U.S. schools ignore personal-finance education? Here’s an answer…


Numerous reports, including one from Champlain College’s Center for Financial Literacy, show how incapable American adults are in financial matters like credit, saving and spending, and retirement readiness. For the benefit of individuals, families and this nation, we must help young Americans develop into financially capable citizens.

One way to do this is to teach personal finance in high school. But not nearly enough students in the country receive this education: Just one in six high-schoolers in the U.S. are required to take at least one stand-alone personal-finance semester for graduation, according to a study conducted this year by my organization, Next Gen Personal Finance.

One University of Wisconsin–Madison study found that only 37% of K-12 teachers had taken a college course offering personal finance.

In 23 states and the District of Columbia, less than 5% of students during the 2018-2019 school year were required to take a stand-alone personal-finance semester.

Many states have passed laws in recent years requiring schools to teach such courses. But we also need to develop more high school personal-finance teachers — as important as legislation is, even more important is a national push for curriculum and teacher professional development.

If there is one thing I’ve learned in trying to bring personal-finance education to every high-school student in America, it’s that high-school teachers are the people who will make it happen.

“Teachers matter more to student achievement than any other aspect of schooling,” according to the RAND Corporation, a nonpartisan think tank. “When it comes to student performance on reading and math tests, a teacher is estimated to have two to three times the impact of any other school factor, including services, facilities, and even leadership.”

I agree. We need to develop a corps of qualified, confident teachers. In fact, laws should incorporate the requisite investment in teacher development to ensure it has its intended positive impact.

Most high-school educators have backgrounds teaching subjects other than personal finance, so it’s no surprise that research like one 2010 University of Wisconsin–Madison study shows few teachers possess the confidence to teach the subject, even though a majority are willing to learn.

Teachers felt least prepared in risk management and insurance, saving and investment, financial responsibility and decision making, and credit and debt.

The study found that only 37% of K-12 teachers had taken a college course offering personal finance. “More than 70% of K-12 teachers indicated they were willing to participate in formal financial-education training,” the study found. Of those personal-financial subjects, teachers felt least prepared in risk management and insurance, saving and investment, financial responsibility and decision making, and credit and debt.”

The best high-school teachers see that their students need financial knowledge and skills. Our team has met thousands of dedicated educators in all 50 states with great ideas and a passion to help the cause.

Courtney Poquette, a business teacher at Winooski High School in Vermont, starts her personal-finance course by asking her students what they would do with $1 million. Most students think about buying things, but by the end of the course, they are also thinking about investing at least some of that money.

Poquette, who has attended professional-development sessions and now leads them, often has students thank her for teaching them how to budget, handle credit and make other financial decisions. We know other outstanding Vermont teachers, but they are not reaching all students since Vermont is one of many states that does not require personal-finance courses in high school.

Kayla Bousum, who also has participated in and led personal-finance education seminars, teaches a required personal-finance course in Johnston High School in Johnston, Iowa. The course had such an effect on one student that he asked if she would help him open a Roth IRA.

Educators like Poquette and Bousum see that their students who are heading to college need to be able to think critically about their financial decision. They also see high-school graduates entering the workforce who need to think about emergency funds, paying taxes and raising their credit scores.

They are the kind of teachers who will drive seven hours through the night to attend one of our personal-finance workshops. They are like the hundreds of teachers who gave up between 20 and 40 hours or more of their summer so they could attend our professional development sessions to improve their craft.

Places with state-mandated personal-finance graduation requirements leads students to make better decisions about how to pay for college.

We need a national army of math, economics, business, family and consumer-science teachers — you name the subject — with the drive to take on this new challenge. We need to invest in them to improve their financial capability, and then give them the tools and methods that are most effective in personal-finance education.

Some people question whether personal-finance education actually works to make students more financially capable. Several studies address this doubt, including a 2018 National Endowment for Financial Education-funded study that found “financial education in states with state-mandated personal-finance graduation requirements causes students to make better decisions about how to pay for college.”

Give schools confident, knowledgeable teachers, and pair those with a relevant curriculum, and there is no question that the formula will lead to success.

There are many organizations — financial institutions and others — that should consider supporting this critically important challenge. Perhaps to inspire some of them, we are offering $1 million to 100 high schools ($10,000 each) whose boards decide by December 2020 that every student deserves and should receive a personal-finance course before he or she graduates. Over the next decade, we will increase our financial support significantly.

I challenge other organizations to invest in teachers so that together we can achieve what we term Mission 2030: having every U.S. high-school student take a personal-finance course before graduation.

Tim Ranzetta is a co-founder of Next Gen Personal Finance, a Palo Alto, Calif.-based nonprofit that provides free personal-finance curriculum and teacher professional development.